Critics of small modular reactors forecast financial risk

A nonprofit nuclear group released a report Thursday saying that efforts to develop small modular reactors at Savannah River Site and other venues will require “tens of billions of dollars” in federal subsidies.

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“SMRs are being promoted vigorously in the wake of the failure of the much-vaunted nuclear renaissance,” Arjun Makhijani, the president of the Institute for Energy and Environmental Research, said in a statement. “But SMRs don’t actually reduce financial risk; they increase it, transferring it from the reactor purchaser to the manufacturing supply chain.”

Small modular reactors – which would be about one-third the size of conventional reactors – have compact designs that supporters believe will offer safety, construction and economic benefits. Proponents say they can be made in factories and be ready to use upon arrival, reducing capital costs and construction times.

Several groups, including Oregon-based NuScale, had expressed interest in using SRS as a venue for such projects, but they were passed over in 2012 when an inaugural U.S. Department of Energy grant was offered to a rival group led by Babcock & Wilcox Co. in partnership with the Tennessee Valley Authority and Bechtel Corporation.

The second round of funding assistance was announced earlier this year, which resurrected interest in SRS, where eight parcels that could be suitable for nuclear manufacturing programs had been identified.

Makhijani’s report, “Light Water Designs of Small Modular Reactors: Facts and Analysis,” estimates that $90 billion in orders would be needed for mass production of the small units.

“A hundred reactors, each costing about $900 million, including construction costs – would amount to an order book of $90 billion, leaving aside the industry’s record of huge cost escalations,” he said. “Shifting from the present behemoths to smaller unit sizes is a financial risk shell game, not a reduction in risk.”